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Crypto managers say ETH isn’t a good investment, but Fortune 500 firms are big on Ethereum

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There’s no doubt Ethereum (ETH) has done well over the past few months. Since the lows of approximately $85-90 seen on Mar. 13, the cryptocurrency has slingshotted higher, peaking as high as $250 to register a gain of nearly 200 percent from the lows.

This performance is so impressive that ETH managed to outperform Bitcoin, which theoretically should lead the cryptocurrency market in a bull trend.

Even still, a confluence of fund managers does not yet see Ethereum as an investment, despite the positive technical trends and a number of Fortune 500 firms big on ETH.

Crypto fund managers come out against Ethereum’s investment case

With Bitcoin starting to underperform alternative cryptocurrencies, there’s no doubt that investors looking in the crypto space have been looking to expand their horizons.

For risk-averse investors, such as institutions that have a fiduciary responsibility, Ethereum may seem like the best bet: it is the size of a medium company, is widely traded, and has been branded by the CFTC as a commodity. There’s a reason why a recent Fidelity Investments survey revealed an 11 percent institutional penetration of Ethereum.

Yet a number of prominent fund managers in the cryptocurrency space have come out against Ethereum, claiming it doesn’t have an investment case at the moment.

Per previous reports from CryptoSlateMichael Novogratz — current CEO of “crypto merchant bank” Galaxy Digitalwrote earlier this year that Ethereum remains in a “proving phase.”

His argument boiled down to the idea that ETH doesn’t have a concrete use case yet like Bitcoin has being a form of digital gold or being a digital store of value.  He added that Ethereum is not yet the “trust level” or blockchain that the majority of the technology world is building upon.

The skepticism has been echoed by Jeff Dorman of Arca. He wrote that Ethereum’s performance is so closely intertwined with that of smaller-cap altcoins makes it “not an interesting investment for anyone outside of the die-hard ETH community.”

The latest to have hopped on this train, so to say, is Exponential Investments partners Leah Wald and Steven McClurg.

On Jun. 11, they published an article on Medium entitled “Ether And Bitcoin Are Not The Same.”  The case they made was extensive, but it boiled down to a number of factors, some mentioned by the aforementioned managers, other points not so much:

  • Ethereum’s monetary policy is inconsistent, deeming it unsuitable to become a viable store of value.
  • Ethereum investors do not have the “HODL” mentality that is so present in the Bitcoin space. This may limit the upside .
  • ETH’s use case as a form of “gas” for transactions means it cannot appreciate too high or else users won’t be able to use it, thus depressing prices.
  • The cryptocurrency is closely correlated with Bitcoin and other cryptocurrencies, even underperforming BTC from a macro scale (since last bull market’s highs).

Fortune 500 companies are accumulating ETH — and they’re using the tech as well

Despite the warnings, there are prominent Fortune 500 firms — and firms near the top of the Fortune 500 — that are getting intimate with Ethereum, but are shying away from platforms like Bitcoin and XRP.

As reported by CryptoSlate, Adam Cochran, a partner at Metacartel Ventures and an adjunct professor at Conestoga College in Canada, found that prominent companies are investing in Ethereum when he looked at the top 10,000 ETH wallets.

His team identified “wallets associated with major players such as JPMorgan Chase, Reddit, IBM, Microsoft, Amazon, and Walmart” building positions in the cryptocurrency. The details were scant, but the crypto investor asserted that “100 percent” of these wallets are accumulating ETH.

Importantly, prominent corporations are doing more than just accumulating the cryptocurrency, they’re using the technology of Ethereum as well.

Although not in the Fortune 500, one of the world’s most prominent social media platforms, Reddit, has created a points/token system for users of two one-million-user subreddits. The system is currently based on an Ethereum testnet, but may soon be migrated over to the main chain. The details CryptoSlate covered here. 

Separately, the “Big Four” professional services company Ernst and Young has begun to use Ethereum technology. One such example of this is its Nightfall, which attempts to use zero-knowledge proofs to make certain Ethereum transactions more private.

Visa may be using Ethereum as well. The company filed a patent for migrating fiat currency to blockchain and the patent mentioned Ethereum addresses.

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Posted In: Ethereum, Analysis

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Source: https://cryptoslate.com/crypto-managers-say-eth-isnt-a-good-investment-but-fortune-500-firms-are-big-on-ethereum/

Blockchain

Mode Adds Bitcoin to Reserves, Joining Microstrategy and Square

A UK-based fintech firm has just announced a large purchase of bitcoin using its cash reserves. Mode Global Holdings, an already bitcoin-friendly financial company, has become the first UK publicly traded firm to allocate part of its reserves to the cryptocurrency. The announcement follows those of Microstrategy and Square. As many cryptocurrency industry observers suspected, […]

The post Mode Adds Bitcoin to Reserves, Joining Microstrategy and Square appeared first on BeInCrypto.

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A UK-based fintech firm has just announced a large purchase of bitcoin using its cash reserves. Mode Global Holdings, an already bitcoin-friendly financial company, has become the first UK publicly traded firm to allocate part of its reserves to the cryptocurrency.

The announcement follows those of Microstrategy and Square. As many cryptocurrency industry observers suspected, Microstrategy’s August revelation appears to now be inspiring others.

Currency Debasement Prompts Mode to Invest 10% of Cash Reserves

First, there was Michael Saylor’s Microstrategy. Then, came Jack Dorsey’s Square. The two companies adding BTC to their balance sheets reveal an emerging appetite for bitcoin as protection against inflation and economic crises.

Mode is the latest publicly-listed company to realize bitcoin’s importance. The UK fintech firm announced the decision via press release on Wed 21 Oct.

Mode has reportedly allocated 10% of its cash reserves on its balance sheet to bitcoin. Motivating the decision is the uncertain global macro-economic outlook in the wake of the coronavirus pandemic.

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The firm says that the bitcoin allocation is an effort to protect the assets of investors from currency debasement. It mentions record low UK interest rates of 0.1% in its justification.

The company recently completed an IPO in which it raised £7.5 million. The press release states that the decision to invest in bitcoin is an effort to “maximize the value of returns” from its IPO.

Despite its recent investment foray into bitcoin, Mode is no stranger to the digital asset. It describes itself as “the bitcoin banking app.” It also sells BTC, as well as the ability to generate interest from holdings.

Another Public Company Finds Refuge in BTC

As mentioned, Mode is by no means the first publicly-listed company to take on exposure in bitcoin. Illustrating this shift is Microstrategy CEO, Michael Saylor. In 2013, Saylor publicly dismissed bitcoin on Twitter:

After eventually doing some research into the cryptocurrency this year, Saylor completely changed his mind.

Recent appearances on various industry podcasts, along with passionate tweets like that below, have quickly elevated the CEO to legendary status in Bitcoin circles:

Whereas Bitcoin previously appeared to represent a tool for criminals, it’s now emerging as a hedge against macro uncertainty. Like Mode, both Microstrategy and Square cited their own concerns about fiat currency debasement in the wake of unprecedented coronavirus stimulus packages around the world.

The nature of these businesses lends themselves to such investments. Both Square and Mode are well-accustomed to the cryptocurrency industry, having both offered BTC exposure for some time.

In the case of Microstrategy, the board of directors is just five-strong with Michael Saylor controlling around 72% of the voting power. It, therefore, would have been much more likely for Microstrategy to invest in BTC compared to other publicly-listed companies.

Some industry observers believe that this is just the beginning of a steepening institutional adoption curve.

Source: https://beincrypto.com/mode-adds-bitcoin-to-reserves-joining-microstrategy-and-square/

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Blockchain

Has Bitcoin met its match with this altcoin?

The feud between Bitcoin and Ethereum is a long-standing one. ‘Feud’ isn’t exactly the right word for it. Perhaps, the communities have fought over which is the superior coin for quite some time. Howe

The post Has Bitcoin met its match with this altcoin? appeared first on AMBCrypto.

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The feud between Bitcoin and Ethereum is a long-standing one. ‘Feud’ isn’t exactly the right word for it. Perhaps, the communities have fought over which is the superior coin for quite some time. However, comparing BTC and ETH is like comparing apples to oranges, while both may be fruits, both are different and alike in their own way.

Here are a few examples:

  1. Bitcoin is more ‘money’ than Ethereum. Bitcoin’s major focus was to be an alternative payment system to the US dollar. Hence, payment/value transfer is the main focus of Bitcoin, while with Ethereum, there are a plethora of use cases that range from smart contracts, building dapps, the world computer, etc.
  2. Bitcoin is an asset that has higher s2f  which is its main attraction/selling point to the global audience. Bitcoin can hold value [aka store of value] and is digital gold, hence, this narrative is quite alluring to the investors. As for ETH, people may find it hard to grasp Ethereum as a blockchain.

While fundamental differences are many and can be elaborate, here are comparisons of an on-chain metric that tries to show the differences between the two.

  1. Bitcoin addresses worth $1 hit a new high of 24 million, and so is the same with ETH addresses holding $1 ETH at 21.4 million.

Source: Coinmetrics

While ETH isn’t far away it still needs to catch up with BTC.

2. BTC addresses that hold less than $10 is at a whopping 16.45 million whereas, for ETH, this number is at 6.51 million. The gap is huge but is not out of the purview of Ethereum.

Source: Coinmetrics

Conclusion

This is both good and bad, depending on how one views it.

On the bright side, Bitcoin has had the 1st mover advantage, however, ETH has almost caught up with bitcoin even though it was launched in 2015, 2016. Considering ETH’s much-awaited and much-delayed ETH 2.0, these numbers could easily be overpassed, should ETH successfully move to ETH 2.0.

To conclude, comparing these coins is counter-cyclical. Bitcoin’s goal is much different than what Ethereum intends to do, so comparing them would be a wasted effort. While the two, as mentioned, are different from each other, trying to build a gateway between the two would benefit both the ecosystem better.

Source: https://eng.ambcrypto.com/bitcoin-and-ethereum-is-one-better-than-the-other

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Blockchain

Yearn Finance Adds GUSD Vaults and Updated Keep3r Network Details

Yearn Finance, one of the leading Defi protocols has recently made an addition on Gemini Dollar (GUSD) vaults to its platform.

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Yearn Finance, one of the leading DeFi protocols, has recently made an addition on Gemini Dollar (GUSD) vaults to its platform. The firm has not yet revealed any strategies or potential earnings from this new addition to the platform. It is recently reported that the other four stablecoin pools on the platform have seen some yearly growth.

This new addition by Yearn Finance is appreciated by Cameron Winklevoss, founder of Gemini exchange. He seems to be quite delighted by this move and believed that the future belongs to the DeFi sector.

Yearn Finance Founder’s Github Updated With More Details

It is also reported that Github of the founder of Yearn Finance recently got updated with the additional details on the Keep3r network. It is believed that this is going to act as a smart contract job platform for all the projects that require some extra operations. Here the job is used for smart contracts that require an entity to perform actions. It is also mentioned that the network will be powered by KPR tokens and these tokens are issued as rewards against job completion. 

Daniel Lehnberg Explored How Protocol Should be Considered 

There has been a lot of discussion regarding this protocol by the Yearn Finance and Daniel Lehnberg has also explored how this protocol needs to be considered.  In the end, it is specified that it is actually not even a company and is not having any shareholders. It indicates that this protocol is not in a good position at present. It is reported that Yearn Finance has again slumped by 14% this week and is currently around the $13,000 mark. This position is still seen as a loss because it is 63% less the all-time weekly high of YFI which was around $37,000 back in September.

READ  BCH Proponent Releases Stamp Chat, Prototype Of Layer-2 On Bitcoin Cash

#Cameron Winklevoss #Daniel Lehnberg #GitHub #GUSD vaults #Keep3r network #KPR tokens #yearn.finance

Source: https://www.cryptoknowmics.com/news/yearn-finance-adds-gusd-vaults-and-updated-keep3r-network-details

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